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Yale Law School Faculty Scholarship
1-1-1938
The Demise of Swift v. Tyson
Harry Shulman
Yale Law School
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Shulman, Harry, "The Demise of Swift v. Tyson" (1938). Faculty Scholarship Series. Paper 4599.
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THE DEMISE OF SWIFT v. TYSON
"IF I am right the fallacy has resulted in an unconstitutional assumption
of powers by the Courts of the United States which no lapse of time or
respectable array of opinion should make us hesitate to correct." 1 Then Mr.
Justice Holmes, with a characteristic and cryptic argument struck at "the
jugular" of Swift v. Tyson, 2 and showed that water, not blood, coursed its
veins. Yet he was not ready to impose the sentence which his verdict seemed
to require. "I should leave Swift v. Tyson undisturbed, as I indicated in
K1thn v. Fairmont Coal Company,3 but I would not allow it to spread the
assumed dominion into new fields." 4 Specifically, he insisted that the del.
Yellow
2.
3.
4.
Holmes, J., dissenting in Black & White Taxicab & Transfer Co. v. Brown &
Taxicab & Transfer Co., 2:76 U. S. 518, 533 (1928).
16 Pet. 1 (U. S. 1842).
215 u. s. 349 (1910).
See note 1, supra.
1336
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THE DEMISE OF SWIFT v. TYSON
1337
cisions of the Kentucky courts governed the legality of a contract for exclusive
taxicab stand privileges at a railroad station in Kentuch.-y. 11 But only Justices
Brandeis and Stone concurred with l\Ir. Justice Holmes. Their six colleagues
not only e.xpressed enthusiastic adherence to Swift v. T'j'SOII but e.xtended the
dominion of its doctrine to the utmost limits. That was in 1928.
Just one decade later, when S·wift 'l'. Tyso11, \'igorous, confident and
respected, was about to reach its centennial, the Supreme Court, in a surprise attack, killed it as dead as that Court can kill a legal doctrine.0 Eight
Justices participated in the case which was the ambush for the attack.7 Four
of them were not on the Bench when the Black & White Taxicab case was
decided. 8 These joined in the e.xecution. The four Justices who were members of the Court both in 1928 and 1938 maintained their previous position.9
Thus was the revolution effected, without a change of \'Ote. Only Justices
McReynolds and Butler remained to protest against the deep swing of the
reaction which their own e.xtreme position in the Black & White case helped
to insure.10
Though a number of cases attest the "fluidity of the Constitution" and the
"courage of the Court" 11 in departing from its own precedents, Eric Rail-
road v. Tompkins is unique. The Court did not merely O\'errule S·wift v. Tsso11
and the Black & TV/lite Taxicab case. It declared unconstitutional a "course"
of conduct in which the federal courts had engaged almost daily since 1842.
It destroyed the effect as precedents of literally hundreds, perhaps thousands,
of federal cases in which the doctrine of Swift v. Tl'S011 was applied. It made
an incidental declaration that Congress, too, has no power to do what the
federal courts had done continuously, albeit now unconstitutionally, for 96
years-provide federal rules of substantive law for non-federal causes of action
in the federal courts. The Court did all this in a case in which decision of
5. Citizens of Kentucky owned the ta.xi and transfer business im·olvcd. Originally
the business was incorporated in Kentuch")'. Before the contract in question \V:IS executed
and "knowing that such a contract would be void under the common law of Kcntucl.·y",
these Kentucky citizens incorporated the business in Tennessee.
6. Erie R.R. v. Tompkins, 58 Sup. Ct. 817 (1938).
7. Mr. Justice Cardozo \\'as absent because of illness.
8. Hughes, C. J., Roberts, Black, and Reed, J. ].
9. Justices McReynolds and Butler voted to follow the doctrine of Swift v. Tyson;
Justice Brandeis and Stone voted to disappro\"e.
10. The one case chosen by the majority in the Tompkins case for :1n illustration
of the "evil" of the doctrine of Swift v. Tyson and the "widespread" criticism aroused
by it, is the Black & White case. Without comment, the majority opinion simply lays
bare the facts of the case so that the naked evil leaps to the eye. The e:~se dC:Ilt \\;th
a clearly local matter; the state law and the policy on which it w:1s b:lScd w:~s definite
and of long standing ; the de\"icc of foreign incorporation w:~s employed for the very
purpose of enabling citizens of the state to evade its law; and the tradition:~! justifie:~tion
for Swift v. Tyson, the need for uniformity, was entirely :~bsent.
11. (1938) 51 HARV. L. REv. 1245. Sec West Coast Hotel \'. Parrish, 300 U. S.
379 (1937); cf. Burnet v. Coronado Oil & Gas Co., 285 U. S. 393, 40tHJ9 (1932).
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the constitutional issues was not "absolutely necessary"; indeed, the constitutional issues were not raised, or argued, by the parties or by the courts
below, but by the Supreme Court itself. And the Court did all this with
reference to a legal situation which presented no novel problem, no current
crisis, no immediate pressures for change, and no newly discovered evidence
justifying change. While exciting widespread interest among lawyers, the
Tompki11s decision was hardly noticed by the general public. It was a change
on an important but highly technical legal issue. One cause of the change was
doubtless the settled conviction, as old as Swift v. Tyson itself and shared by
a substantial part of the legal profession, that the decision in Swift v. Tyson
was wrong. 12 Another cause, and probably the occasion also, may be found,
in part at least, in the increased power and activity of the federal government
sanctioned by the Supreme Court in the 1936 and 1937 terms.
II.
The judicial power of the United States is established by Article III of the
Constitution. It provides for the creation of a federal judiciary and states
that its powers shall extend to, i11ter alia, "all cases of admiralty and maritime
jurisdiction." On the basis of this grant of jurisdiction to the federal courts,
aided by the "necessary and proper" clause, the Supreme Court decided that
"Congress has paramount power to fix and determine the maritime law which
shall prevail throughout the United States"; that state laws may affect the
"general maritime law as accepted by the federal courts" only within very
narrow limits ;13 and that even Congress could not make state workmen's
compensation laws applicable to work accidents within the admiralty jurisdiction of the federal courts.14 The grant of jurisdiction in Article III is
thus the basis for paramount, and in major part exclusive, power in Congress
to enact a code of law for cases within that jurisdiction.1G And it is the basis
for the power of the federal courts to declare or make that law in the absence
of federal legislation, without serious restraint from either state statutes or
the decisions of state courts.
The same sentence of Article III which grants admiralty and maritime
jurisdiction also extends the federal judicial power to controversies "between
citizens of different states." Here it is the citizenship of the parties, not the
nature of the controversy, that is the ground for federal jurisdiction. And
it is here that Swift v. Tyson had its chief application. Federal courts have
12. The extensive literature on the subject, pro and co11, is collected in the opinion
of Mr. Justice Brandeis in the Tompkins case.
13. See Southern Pacific Co. v. Jensen, 244 U. S. 205 (1917).
14. Knickerbocker Ice Co. v. Stewart, 253 U. S. 149 (1920); Washington v.
Dawson & Co., 264 U. S. 219 (1924). See Comment (1932) 41 YALE L. J. 1037;
note (1936) 45 YALE L. }. 1126.
15. Were the question at issue at the present time, great reliance would of course
be placed upon the commerce power. The federal courts have had exclusive jurisdiction
in admiralty since 1789.
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THE DEMISE OF SWIFT z•. TYSON
1339
power to adjudicate almost any controversy bel:\veen citizens of different
states. But since they must adjudicate only in accordance with law, the question arose: in accordance with what law? Broadly, 1:\\'0 answers might have
been suggested: (a) in accordance with federal law as enacted by Congress
or declared by the federal courts in the absence of Congressional legislation
-a technique similar to that developed in the admiralty cases; (b) in accordance with state law as enacted by state legislatures or declared by state courts.
The answer that actually developed was still a third.
The first Judiciary Act, 1789, provided in its Section 34, which has been
retained in the federal judicial code to date, that "the laws of the scver:>l
states, e.xcept where the constitution, treaties or statutes of the United States
shall otherwise require or provide, shall be regarded as rules of decision in
trials at common law in the courts of the United States where they apply.'' 10
The answer to the question "in accordance with what Jaw" was then to be
sought not simply in the Constitution but also in the Judiciary Act. And,
until the decision in the Tompkins case, the battle centered around the 34th
section of the Judiciary Act rather than the Constitution.
In Swift v.
T)•SOJZ
and the host of cases following it, this answer was
developed: that, e.xcept as prohibited by the Constitution, the states had
plenary power to enact substantive law which would govern the adjudication
of controversies including those in the federal courts; that Section 34 applied
only to "state laws strictly local, that is to say, to the positive statutes of the
state, and the construction thereof adopted by the local tribunals, and to
rights and titles to things having a permanent locality, such as the rights and
titles to real estate, and other matters inunO\·able and intraterritorial in their
nature and character" ; 17 that as to matters of "general jurisprudence" or
"commercial law" the federal courts were not bound by the decisions of the
state courts, but rather by the common law, of whiclt the state decisions were
merely some evidence; that in these matters the federal courts were free to
ascertain and declare the common law independently, "upon general reasoning
and legal analogies", even if their decisions were consequently to confiict with
applicable state decisions.
This doctrine was congenial to the juristic atmosphere in which it was
born and to the human demands for self-c.xpression of the federal judges who
nurtured it. Even to-day, the common law is frequently regarded as a system
of law prevailing throughout the United States and not anchored to any particular territorial sovereignty. Lawyers and judges arc jealous of the conception that the common law is a living organism, that it grows and changes
in response to felt needs and changing intelligence. And the moulders of
change are the judges! State court judges can control their precedents: they
can create, distinguish, modify, O\'er-rule or ignore. They can put a little
16. 1 STAT. 73, 92 (1789), 28 U. S. C. § 725 (1928).
17. Swift v. Tyson, 16 Pet. 1, 18 (U. S. 1842). Some lower courts thought the
N.I.L. was not a statute within this rule. But see Marine National Bank v. Kalt-Zimmers
Mfg. Co., 293 U. S. 357 (1935).
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of themselves into the growing or changing law. Federal judges feel the
same need. Their tasks must have elements of creativeness. And they, like
state judges, doubtless cherish independence and freedom in responding to
their intelligence and to felt needs. The doctrine of Swift v. Tyson answered
these demands. "Undoubtedly, the decisions of the local tribunals . . •
[on matters of 'general commercial law'] are entitled to, and will receive,
the most deliberate attention and respect of this Court; but they cannot
furnish positive rules, or conclusive authority, by which our own judgments
are to be bound up and governed." 18
The stated justification for the doctrine of Swift v. Tyson is the need or
desirability of uniformity of law throughout the country. That case itself
involved a negotiable instrument. And Mr. Justice Story, though influenced
by his "restless vanity", his fondness of "glittering generalities", his reputation for "great learning" and by the fact that "he was occupied at the time.
in writing a book on bills of exchange'', 19 expressed an opinion commonly
held to-day when he said : "The law respecting negotiable instruments may
be truly declared in the language of Cicero, . . . not the law of a single
country only, but of the commercial wofld. Non erit alia le~ Romac, alia
Athenis, alia mmc, alia postlzac, set et apud omnes gentes, et omni tempore,
mza eademque le~ obtenebit."20 The various uniform state laws already
adopted and the continuing pressure for more attest the vitality of Mr. Justice Story's idea.
III.
Mr. Justice Holmes' exposure of the "subtle fallacy" underlying the doctrine of Swift v. Tyson was foreshadowed in 1917, when he wrote in his
dissenting opinion in Southern Pacific Co. v. Jensen: "The common law is not
a brooding omnipresence in the sky but the articulate voice of some sovereign
or quasi-sovereign, that can be identified; although some decisions with which
I have disagreed seem to me to have forgotten the fact." 21 There he was
protesting against the Court's expansion of the federal maritime jurisdiction
to the exclusion of state law. In 1928, in the Black & White Ta~cab case,
he addressed himself specifically to Swift v. Tyson. "Books written about
any branch of the common law treat it as a unit. . . . It is very hard to
resist the impression that there is one august corpus, to understand which
clearly is the only task of any Court concerned. If there were such a transcendental body of law outside of any particular Stat~ but obligatory within it un18. Swift v. Tyson, 16 Pet. 1, 19 (1842).
19. GRAY, THE NATURE AND SouRCE oF THE LAW (2d ed. 1921) 253.
20. Swift v. Tyson, 16 Pet. 1, 19 (U. S. 1842). See Steffen, Some RccCIIt S11Prcme
Co11rt Decisio11s Relating to Negotiable !11stntme1Jts (1936) 12 IND. L. J. 1, 5; Beutel,
Common Law Judicial Teclz11ique and the Law of Negotiable brstruments-Two Un·
fortunate Decisions (1934) 9 TuL. L. REv. 64.
21. 244 u. s. 205, 222 (1917).
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THE DEMISE OF SWIFT -zr. TYSON
1341
less and until changed by statute, the courts of the United States might be right
in using their independent judgment as to what it was. But there is no such
body of law. The fallacy and illusion that I think e:cist consist in supposing
that there is this outside thing to be found. Law is a word used with different
meanings, but law in the sense in which courts speak of it today does not
exist without some definite authority behind it. The common law so far as
it is enforced in a state, whether called common law or not, is not the common
law generally but the law of that state existing by the authority of that state
without regard to what it may have been in England or anywhere else. • . .
"If within the limits of the Constitution a State should declare one of the
disputed rules of general law by statute there would be no doubt of the duty
of all courts to bow, whatever their private opinions might be. • . • I see
no reason why it should have less effect when it speaks by its other voice.
1122
Mr. Justice Holmes referred to the research of Mr. Charles 'Varren!!a
which showed "that Mr. Justice Story probably was wrong" in his interpretation of Section 34, "if anyone is interested to inquire what the framers
of the instrument meant." 24 But to him the question was "deeper than that;
it is a question of the authority by which certain particular acts • • • are
governed. In my opinion the authority and only authority is the state, and
if that be so, the voice adopted by the State as its O\'m should utter the last
word." 25 The issue as Mr. Justice Holmes phrased it, then, was not one
of statutory construction, but rather of constitutional authority.::! 0 His argument, if right, undermined Swift v. Tyson itself as well as the e......1:ension of
its doctrine to fields of law other than that relating to negotiable instruments.
Yet he would "leave Swift v. Tyso1~ undisturbed" and urged only a curb on
the spread of its dominion to other fields.
Perhaps this was merely an instance of the traditional judicial reluctance
to decide more than the issues necessarily presented in the case at hand.
22. 276 u. s. 518, 534 (1928).
23. Warren, Ne-..u Light on tlze History of tlze Federal Judiciary Act of 1789 (1923)
37 HAltv. L. REv. 49.
24. 276 u. s. 518, 535 (1928).
25. Ibid.
26. The issue was early put in constitutional terms by Mr. Justice Field dissenting
in Baltimore & Ohio R.R. v. Baugh, 149 U. S. 368, 401 (1893) : "But, notv.ithstanding
the great names which may be cited in favor of the doctrine, and notwithstanding the
frequency with which the doctrine has been reiterated, there stands, as a Pl!l"Petual
protest against its repetition, the constitution of the United States, which recognizes
and preserves the autonomy and independence of the states,-indcpendence in their legislative and independence in their judicial departments. Supervision over either the legislative or the judicial action of the states is in no case permissible C.\:cept as to matters
by the constitution specificatty authorized or delegated to the United States. Any interference with either, e.xcept as thus permitted, is an in\"asion of the authority of the
state, and, to that extent, a denial of its independence." But Mr. Justice Field stood
alone. See the letter of Mr. Justice Field in (1938) 47 YALE L. J. 1104, 1105.
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The Black & White case did not involve commercial paper and it was unnecessary to state then the power of the federal courts with respect to such
paper. The "unconstitutional assumption of power" might be corrected by
a series of decisions rather than by decision in one case. But perhaps, also,
Mr. Justice Holmes was willing to leave part of the "unconstitutional assumption" uncorrected.' Law not uncommonly develops on the base of an initial
error. The fallacy which Mr. Justice Holmes exposed might cause difficulty
in the articulation of a symmetrical juristic theory. But, after all, law had
been administered on the basis of Swift v. Tyson since 1842. In the field of
commercial paper at least, it had many adherents who thought that it tended
to achieve what the state legislatures were striving for in the enactment of
uniform laws. Insofar as the initial error did not, in the limited field, cause
undesirable consequences but on the contrary seemed to be congenial to an
expanded national commerce, it might well be left undisturbed, though the
errol;' were exposed to prevent its spread to o!her fields. Juristic theory
could be left to make its own accommodation.
IV.
In the Tompkins case, the Court did not show the restraint of Mr. Justice
Holmes. It decided to destroy with one blow the entire structure and its
foundation. The difference between Mr. Justice Reed and his brethren in
the majority related to the choice of tools. He would use the tool of statutory
construction. He would make the words "the laws" in the Act of 1789 now
"include in their meaning the decisions of the local tribunals". He is willing
to upset a century old interpretation because "in this Court, stare decisis, in
statutory construction, is a useful rule, not an inexorable command., And
he is unwilling to invoke the Constitution because, if the statutory construction is changed, constitutional interpretation is unnecessary, and because he
is not quite sure of his opinion on the constitutional issues. "I am not at all
sure whether, in the absence of federal statutory direction, federal courts
would be compelled to follow state decisions." And also "questionable" to
him is the statement that "Congress is without power to declare what rules
of substantive law shall govern the federal courts, . . . The Judiciary Article'
and the 'necessary and proper' clause of Article One may fully authorize
legislation, such as this section of the Judiciary Act." 27
Mr. Justice Butler, writing for himself and Mr. Justice McReynolds,
argues for adherence to Swift v. Tysott and its superstructure. But he devotes major emphasis to the "extraordinary or unusual action by the Court,
in raising a constitutional issue which, in his opinion, was not raised by the
petition for certiorari and which was not argued either in the Supreme Court
or below, and in deciding the constitutional issue without calling for argument on it, as requested to do by the dissenters. In his opinion, the Court
declared Section 34, as construed, unconstitutional and, before doing so,
?:!. Erie R.R. v. Tompkins, 58 Sup. Ct. 817, 828. The Justice probabty·meant "legislation enacting the doctrine of Swift v. Tyson." No one doubted the validity of Section 34.
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THE DEMISE OF
S~VIFT
"'· TYSON
1343
should have notified the Attorney General as required by the Judiciary Act
of 1937. In any event since a constitutional question "of great public importance" was decided, the Court should have invited the United States to
intervene and present argument. "Indeed, it would have been appropriate
to give Congress opportunity to be heard before devesting it of power to
prescribe rules of decision to be followed in the courts of the United States." 28
With stirring emphasis, Mr. Justice Butler refers to the "safeguards against
the improvident use of the great power to invalidate legislation" and the "reluctance to consider constitutional questions . . • if the case may be decided
upon any other ground",:m a point of view of which Mr. Justice Brandeis
and Mr. Justice Stone have been the greatest exponents in the Supreme Court.
But there is a noticeable lack of reference to the Ashwaudrrco case where
Mr. Justice Brandeis made the most elaborate exposition of this point of
view, in dissenting from an opinion in which Mr. Justice Butler concurred.
Nor is there reference to Carter v. Carttr Coal Compaws,31 where the majority, including Mr. Justice Butler, invalidated the Guffey Coal Act over
the protest of Justices Cardozo, Stone and Brandeis that the constitutional
issues were not ripe for decision. Nor is there reference to the Railroad Retirement case 32 where the majority, including Mr. Justice Butler, went far
beyond the necessities of the case to curb tlte power of Congress over the
protest of four Justices.
Yet the majority opinion written by Mr. Justice Brandeis was e.xtraordinary, in view of the Justices who comprised the majority. The opinion
begins by stating that the "question for decision is whether the oft-challenged
doctrine of Swift v. Tyson shall now be disapproved." 33 It concludes that:
"If only a question of statutory construction were im·olvcd, we should not
be prepared to abandon a doctrine so widely applied throughout nearly a
century. But the unconstitutionality of the course pursued has now been made
clear and compels us to do so.
"Except in matters governed by the Federal Constitution or by Acts of
Congress, the law to be applied in any case is the law of the State. And
whether the law of the State shall be declared by its Legislature in a statute
or by its highest court in a decision is not a matter of federal concern. There
is no federal general common law. Congress has no power to declare substantive rules of common law applicable in a State whether they be local in
their nature or "general", be they commercial law or a part of the law of
28. Id., at 827.
29. Id., at 826.
30. Ashwander v. Tennessee Valley Authority, 297 U. S. 283 (1936).
31. 298 u. s. 238 (1936).
32. Railroad Retirement Board\'. Alton R.R., 295 U. S. 330 (1935). Likewise tltere
is no reference to Willing v. Chicago Auditorium, 277 U. S. 274 (1928) or to Bradford
Electric Co. v. Clapper, 286 U. S. 145 (1932) where ~lr. Justice Stone protested that
the Court opinions, written by ~lr. Justice Brandeis, unnecessarily decided constitutional
issues. See (1932) 42 YALE L. J. 115.
33. Erie R.R. v. Tompkins, 58 Sup. Ct. 817, 818.
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torts. And no clause in the Constitution purports to confer such a power upon
the federal courts."34
It is quite apparent that the statement about the power of Congress was
not necessary to a decision of the question even as propounded by the Court.
It would have been enough to say that, at least in the absence of legislation,
the state decisions must be followed. To that e..xtent Mr. Justice Reed's
protest is unanswerable. Yet the majority's dictum may be overemphasized.
It was not elaborated. It could hardly be a complete delineation of Congressional power in that respect under the commerce clause, the necessary
and proper clause and the other clauses of the Constitution. It probably
means only that no general power of the kind stated is conferred upon
Congress ; that legislation of that character must be considered in the light
of powers conferred in other terms. So construed, the statement is still
unnecessary to the decision, but its importance is considerably lessened.
It was equally unnecessary to rule on the constitutionality of the "course
pursued" by the federal courts. But here Mr. Justice Reed's opinion is
not equally unanswerable.35 On this point, indeed, the majority opinion,
amended so as to apply only in the absence of Congr:essional legislation, seems
preferable, if choice is restricted to the majority and concurring opinions.
To be sure, stare decisis is not "an inexorable command"- even less so
in constitutional interpretation than in statutory constmction. But it is
no derogation of the function of the judiciary in legislation that, at least
34. ld., at 822. This and the quotations from Mr. Justice Holmes and Mr. Justice
Field are all that the opinion contains on the constitutional issue. The opinion does not,
as Mr. Justice Butler laments, "indicate precisely the principle or provision of the Constitution held to have been transgressed" (p. 826). Apparently the conclusion rests on
the "limited powers" doctrine and the Tenth Amendment. Congress does net have a
general power to legislate on all activities within the state. It is given no express power
to prescribe the rules of substantive law to be applied in federal courts in all cases.
In the absence of valid Congressional legislation and on matters not withdrawn from
state cognizance by the Constitution, the States have paramount power to prescribe the
legal consequences of conduct, whether by legislation or by judicial decision. Adjudication by federal courts in express disavowal of the binding authority of such
prescription impairs the reserved power of the States. In this respect no differentiation
is made between rules of law declared by state legislature, and those declared by state
courts.
The suggestion of Mr. Justice Reed that Article III of the Constitution in conjunction with the necessary and proper clause may fully authorize Congress to prescribe the
substantive law to be applied in diversity of citizenship cases which raise no federal
questions is not mentioned in the majority opinion. Perhaps the suggestion was thought
irrelevant, since the validity of such legislation would depend upon judgment as to
necessity and propriety of the relation in the particular instance rather than upon the
existence of a general power. The suggestion recalls, of course, what the Court did
with the federal admiralty and maritime jurisdiction. See supra, p. 1338. But the differences in subject matter, history and necessity must also be recalled.
35. His statement that "Mr. Justice Holmes evidently saw nothing 'unconstitutional'
which required the overruling of Swift v. Tyson" is a whimsical version of the dissenting opinion in the Black & White case.
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THE DEMISE OF SWIFT v. TYSON
1345
over a long period, the content of statute law is the special concern of the
legislature, while in constitutional interpretation our system makes the Court
supreme. The words of Section 34 which Mr. Justice Reed reinterpreted
are not like the phrase "due process of law" or the words "reasonable" and
"fair" which imply interpretation in accordance with changing time and
circumstance. One can hardly censure a court for refusing to reverse the
interpretation of a statute which for a century has received a consistent
construction, yet has not been changed by the legislature despite repeated
attempts to do so. And if the interpretation of the statute was not to be changed
merely because of a later belief in the error of the initial interpretation,
reversal of the doctrine of Swift v. T·yson could be justified only by other
reasons. Moreover, the evidence that Section 34 was erroneously interpreted
is still inconclusive, despite the positive assertion in the majority opinion.
To Mr. Justice Holmes, Charles \Varren's researches showed only that "~Ir.
Justice Story probably was wrong if anyone is interested to inquire what the
framers of the instrument meant." 36 To l\Ir. Justice Brandeis, in the Tompkins case, the same researcl1es established the certainty, rather than the probability, of error. Yet neither opinion undertakes a statement or analysis of
the evidence adduced or a search for additional evidence. Nor does ~Ir.
Justice Reed do so. Mr. \Varren's researches are illuminating and of great
value. But surely much is left for further scholarly investigation. And it
is doubtful whether a reversal based on changed juristic conceptions of the
meaning of the words "law" and "laws" would have carried conviction.
Choice was not, however, confined to the views of the majority and those
of Mr. Justice Reed-and even those of the dissenting Justices. The Court
could have followed :Mr. Justice Holmes and left S1.vift v. T·ysou undisturbed
while preventing the e.xtension of its doctrine to situations like those invulved
in the Tompkins, Black & TV/zitc, and Kulzn cases. It could also have dis-approved of the entire structure without resort to constitutional or statutory
interpretation.
Assuming that Section 34 has the same meaning to-day that it had at least
since 1842, it does not prescribe the rule to be followed when there is no
applicable local statute. In the absence of such a local statute, Section 34
as construed does not apply; but the federal court must nevertheless decide
by what law to adjudicate its cases. Similarly, Section 34 in express language
-applies only to "trials at common law". This, it was argued in .llaso11 "'·
United States, "by implication excludes . . . equity suits." 37 But, the Court
answered, the statute "is merely declarative of the rule which would exist
in the absence of statute" and the rule "is not to he narrowed lJccaU"t.' nf
an affirmative legislative recognition in terms less hro::ul than the ruh.'." 3 " The
Court, therefore, applied the rule of Section 3-l to equity suits.
36. See note 24, supra.
37. 260 u. s. 545, 558-9 (1923).
38. Ibid.
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The freedom of the federal courts announced in S'Wift v. Tys011 resulted
not from constitutional or statutory command but rather from the assumed
silence of the Constitution and the statute. 30 It was the Court's notion of
sound policy in the absence of legislation that was given as a reason for not
being bound by state decisions. Likewise, the Court in the Tompki11s case
could have left co"nstitution and statute alone and announced its view that
present public policy, in the absence of legislation, requires an adherence to
state decisions. That would have involved only change of judge-made ntle
based on a stated policy to conform with a change of judicial view as to
that policy in the light of experience. Mr. Justice Reed's notion that to
disapprove Swift v. Tyson requires a reading of the words "the laws" in
Section 34 "to include in their meaning the decisions of local tribunals" is
premised- on the unwarranted assumption that the Section, as previously
construed, prohibits federal courts from following state decisions in the same
manner that the Section requires them to follow state statutes. Neither Swift
v. Tyson nor its sequelae announced such a doctrine. For cases outside the
statute there was simply no command in the statute:to
It is quite clear that in the last analysis it was considerations of policy,
rather than juristic symmetry, that were responsible for the decision in the
Tompkins case, as they were in Swift v. Tyson. Before coming to the issue
of constitutionality, the majority opinion depicts the "broad province'' to
which the dominion of Swift v. Tyson had been extended, the "widespread
criticism" of the doctrine following the decision in the Black & White case,
its "political and social defects", the "grave discrimination" which it introduced "by non-citizens against citizens" and "the injustice and confusion
incident to the doctrine." These were consequences not of legislative command, but of judicial decision in the Court's own domain. They were risked
39. The doctrine of Swift v. Tyson must rest of course on an assumption that the
Constitution permits it.
40. Swift v. Tyson was before the Court at this term in Willing v. Binenstock,
58 Sup Ct. 175 (1937). The decision of the court was unanimous that the Pennsylvania
decisions were to apply on the issue whether a member of a partnership could set off
his individual deposit in a Pennsylvania national bank against the partnership indebtedness to the bank which was then in the hands of a receiver. The opinion, written
by Mr. Justice Sutherland, states: "We have no occasion to consider whether Section
721 of the Revised Statutes is applicable. Under Swift v. Tyson • • • it would not be.
That case has been much criticized, and the tendency of our decisions which have followed has been to limit it somewhat strictly. And one of the practical restrictions upon
the principle of that case, which we have many times announced, is that, even where
it applies, 'for the sake of harmony and to avoid confusion, the federal courts will
lean towards an agreement of views with the state courts if the question seems to them
balanced with doubt.' . . . Even if there were a conflict between the decisions of
the state and those of the lower federal courts, we should be free to apply the 'harmony'
rule and follow the state decisions.'' (p.177). The result in the Tompkins case could
have been reached, then, by expansion of the judge-made "harmony" rule. There was
"no occasion" to reconsider the statute or the constitution.
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THE DEMISE OF SfVIFT v. TYSON
1347
for the achievement of ends which the Court thought important. \Vhen experience brought convictiQn that the ends were not to be achieved in that
way or that the price was too high, the Court had the responsibility of correction. To have limited the decision in the Tompkitzs case to the narrowest
available legal issue-that the liability of the railroad was to be detennined
by local rules-would have increased rather than diminished the confusion.
An attempt to define specific limits within which the federal courts were to
confine their freedom under the doctrine of Swift v. T•yson was doomed to
failure by the experience of a century. Only a complete reversal of approach
could lead to the required end. The reversal could have been effected ·without aid from the Constitution. But the Constitution comforted a hard-pressed
nostalgia for decentralization and local responsibility. And it lent aid ·without imperilling any existing federal policy or any presently likely federal
legislation.
IV.
An appraisal of·the Tompki11s and Swift cases in tenns of "justice" and
"mischief" is not likely to command universal assent. The litigant who
escaped an "unjust" rule of state law by resort to the federal court doubtless
thinks that he found "justice". His adversary is equally sure that he has
suffered an "injustice". And the paradox is that both are equally right.41
Even to a disinterested person the results reached in some cases via the
"federal rule" seem more just than those via the "state rule"; in other C3$es,
less just. Yet all agree that discrimination in the rights and liabilities of
litigants simply on the basis of whether they happen to be, at the institution
of suit, citizens of the same state or of different states is at least regrettable.
The discrimination conflicts with the ideals of certainty in legal rights and
equal justice before the law. In a federal system it is a constant source of
irritation. It constitutes a curious limitation upon state law in matters concededly within state cognizance. And escape from state Jaw by the device
of creating diversity of citizenship arouses resentment, particularly in cases
of wide public interest.4 2
41. In the Tompkins case it was the railroad that complained o£ the Swift v. Tyson
doctrine and called for the application of tl1e local rule. The rc\·crsal of the judgment
by the Supreme Court may cost Mr. Tompkins his $30,000 verdict. In the controversy
about the higher law, the merits of Mr. Tompkins' claim were all but forgotten. They
are mentioned only in the last sentence of Mr. Justice Butler's opinion: "I am of
opinion that the constitutional validity of the rule need not be considered, because under
the law, as found by the courts of Pennsylvania and generally throughout the country,
it is plain that the evidence required a finding that plaintiff was guilty of negligence
that contributed to cause his injuries, and that the judgment bclow should be revcr~ed
upon that ground." (p. 828).
42. Suits in federal courts for labor injunctions are cases in point. See Shulman
& Jaegerman, Some Jurisdictional Limitations 011 Federal Procedure (1936) 45 YALE
L.
J.
393, 400--03.
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These regrettable consequences may be deemed not too high a price for
the expected benefits of the Swift v. Tyson doctrine: uniformity of law
throughout the country and, perhaps, the development of a more suitable
law. This view is premised, of course, on the assumptions that the law will
be improved by permitting the federal courts to contribute to its develop~
ment through their independent decisions, and that, in any event, uniformity
even of poor law is better than variety of state law, some good, some bad.
To what extent the doctrine of Swift v. Tyson has promoted uniformity
of law is still a mystery. Very little has been done to ascertain the fact, if,
indeed, it is possible to ascertain it at al1. 43 It may be assumed that federal
decisions have influenced state courts as much as decisions of sister states.
But beyond that assumption may not venture. For, a priori, there is little
reason to expect a greater influence. The Supreme Court has been handling
a steadily diminishing number of common law cases. Litigation which is the
stuff of the daily work of state judges is something of a sport in the Supreme
Court. If it once had the prestige as an oracle of supreme wisdom on com~
mon law questions, it could not maintain that position when common law
issues became a small and minor part of its business. Th~ ten Circuit Courts
of Appeals and the more than four score federal district courts, are too
numerous and too close to home, and they differ too much among themselves, to promote uniformity in greater degree than the decisions of sister
states.44 Some state courts, particularly some state judges, have unques~
tionably achieved great prestige and influenced the development of law in
other states. Whether Swift v. Tyson has enabled the federal courts to do
as much or more is, however, an open question.
But one conclusion is not questionable. In 96 years the doctrine of Swift
v. Tyson has not achieved complete or even ncar uniformity. The list of
differences between state and federal law, as disclosed in the Tompkitts case,
is still imposing. To variety in state laws has been added an element of
uncertainty, even greater than that implicit in that variety. Without S1t1ijt
v. Tyson, one might attempt a prediction that his conduct or transaction
will be governed .by the law of a particular state, and then seek to ascertain
what that law is. With Swift v. Tyson, he must take into account two addi~
tiona] and uncertain contingencies : that the possible litigation may or may
not land in a federal rather than a state court, and that the federal court
may or may not follow the law of the state as he ascertains it from the state
decisions. If the doctrine tended to promote uniformity of law throughout
the country, it also caused lack of uniformity within the state. It enabled
• 43. See Frankfurter, Distributio1~ of l1tdicial Power betwee11 U11ited States a11d State
Courts (1928) 13 CoRN. L. Q. 499, 529 n. 150; Yntema and Jaffin, Prelimiuary A11alysis
of Coucllrre~~t l11risdicti01~ (1931) 79 U. OF PA. L. REV. 869, 881 n. 23; Shulman &
Jaegerman, supra note 42, at 402 n. 36.
44. Cf. A. N. Hand, ]., in Cole v. Pennsylvania R.R., 43 F. (2d) 953, 956-7
(C. C. A. 2d, 1930).
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THE DEMISE OF STVIFT v. TYSON
1349
federal courts frankly and boldly to assert their independence of state court
decisions, to confess expressly that their decisions would have been different
if they were bound to decide as the state courts did.
Another consideration is to be weighed in pondering the question what
price uniformity via Swift v. Tyson. To-day, unlike the condition in 1842,
lawyers and judges receive their legal education in national law schools.
Many students at the law schools do not know where they will practice.
Not the law of a particular state1 but the law of the states is their subject.
Treatises on law and legal periodicals are numerous. They deal with the
law of the states, not that of a single state. The American Law Institute
Restatements recognize no differences between the states. They restate the
better rule for all of them. The Commissioners on Uniform State Laws are
constantly striving for the enactment of more uniform laws. National reporting
and digest services are everywhere available and in common use. All these
are factors tending toward uniformity. All offer law to the states for voluntary adoption. None of them imposes from the outside at the pain of penalty.
None of them creates the "injustice", "confusion" or "discrimination" which
are thought to attend the doctrine of Swift v. T'J'SOII. And each of them seems
to be a force for uniformity much more powerful than that doctrine can be.45
But the Tompkins case does not destroy the power of the federal courts
to influence the development of the non-statutory law. That power is exerted
not so ~uch by the judgments in cases as by the written opinions. Federal
judges may still analyze, e.xpose, criticize or e.xcoriate the rule which they
may feel compelled to follow. The persuasive influence and moral pressure
of their opinions will not be diminished by the fact that they obediently
follow decisions which they do not have the power to overrule.
V.
What, then, are the effects of the Tompki11s decision? One effect may be
ventured with confidence. Federal courts may no longer declare themsel\'cs
free of state decisions. They may not adjudicate a case as if state decisions
were irrelevant. They must e.xpress obedience to state law, including state
decisions. And they must make a conscientious effort to decide in accordance
with that state law. Beyond this confidence will not go. Both the Tomp!:i11s
case and Swift v. Tyson deal more with verbal statement of the law than
with the judgments in cases.4 6
A case is not born ordained for a particular legal rule. Nor are legal rules
complete, unique works of art with every feature, e\'el)' line, every contour
definitely fixed. Identity of legal rules does not insure identity of judgments.
Even with the Tompkins case, the federal courts are still free to find, inter45. An attempt to appraise the influence of the doctrine of Swift v. Tyson on uniformity must allow, of course, for these and other factors pulling in that dire.."tion.
46. See Shulman & Jaegerman, loc. cit. sttpra note 42.
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pret and appraise the facts. They are still free, presumably, to choose between
rules or legal theories in the light of their appraisal of the facts. And they
still have the judicial prerogative of at least honestly. distinguishing cases.
Does this carry the power to disregard a state decision on the ground that
it will doubtless be overruled by the state court at the first opportunity? And
does the Tompkins case require adherence to a single state decision or only
a line of decisions, to the decisions of lower courts or only to those of the
highest state courts ?47 And if the "applicable" state decision is rendered during
the pendency of the federal case either in the district court or oh appeal,
must it be given effect?
Again, when the requisites of jurisdiction exist, must the federal courts
enforce every right, every liability, for example, a yellow dog contract, which
is enforceable in the comparable state courts? May the federal courts have
a policy of their own, independent of the policy of any state, against the
grant of certain types of relief or against the enforcement of certain types
of claims, such as an injunction against peaceful picketing, at least if the
parties are free to pursue their claims in the state courts? The Tompkins
case probably has no bearing on these questions. Congress has the power, in
its regulation of federal jurisdiction, to make certain forms of relief unavailable
in the federal courts under stated circumstances or to make certain transactions unenforceable by federal process.48 The extent of the similar power in
the courts depends upon their function within the federal government rather
than upon their relation to state law.
The Tompkins case relates primarily to the diversity of citizenship jurisdiction of the federal courts. Issues of non-statutory law may, however, arise
also in cases in which federal jurisdiction is based on some other ground,
in patent or bankruptcy cases, in litigation with the Government concerning
federal taxation, in the liquidation of national banks, etc., etc. \Vhen a common law issue arises in the course of such litigation, interests are affected
which are not involved in diversity of citizenship cases. Specialized federal
common law for such controversies is consistent with the statement of the
majority in the Tompki11s case that "there is no federal general common
Iaw". 49 On the very same day on which the decision in the Tompki11s case
was rendered, Mr. Justice Brandeis delivered the unanimous opinion of the
Supreme Court that "whether the water of an interstate stream must be
apportioned between the two States is a question of 'federal common law'
upon which neither the statutes nor the decisions of either State can he
conclusive." 50
47. See the comment of Prof. Corbin, iufra, p. 1352.
48. See, for example, the Norris-LaGuardia Act, 47 STAT. 70 (1932) 29 U. S. C.
§ 101 (1934) and Levering & Garrigues v. Morrin, 71 F. (2d) 284 (C. C. A. 2d, 1934).
And see the previous Supreme Court decision in the same case, 289 U. S. 103 (1933).
49. 58 Sup. Ct. at 822.
50. Hinderlider v. La Plata River & Cherry Creek Ditch Co., 58 Sup. Ct. 803.
811 (1938).
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THE DEMISE OF SJVIFT v. TYSON
1351
The decision in the Tompkins case may facilitate the joinder of actions
in the federal courts and the decision of non-federal as well as federal claims
when presented together in a case in which federal jurisdiction is properly
iD·oked!;1 A serious objection to such a practice in the past was the likelihood that the federal decision would be different from the one that could
be expected if the non-federal claim were to be tried in a state court.ll2 With
this likelihood diminished, there may be greater freedom in yielding to the
felt needs for economy and convenience in judicial administration by disposing of the several claims in a single action.
Conflict of laws and the due process clause may assume an added importance. If a case is to be governed by decisions of a state court rather than
by federal decisions, it becomes important to decide by the decisions of
what state. And what state's rule of conflict of laws is to govern? Again,
cases like Gelpcke v. Dubuqrte,r. 3 Burgess v. Scligmau::t• and the Black &
White Taxicab case1i5 may raise substantial questions of due process, now
that the escape of diversity of citizenship is shut off. Is the power of state
courts to overrule previous decisions or to invalidate contracts on grounds
of public policy unliniited ?l:i 6
Further argument on the distinction bet\veen "substantive law" and what
is "procedure" is probably another consequence. For federal power over
procedure in the federal courts is left undisturbed by the Tompkins case.
Answers to these and other questions will be worked out primarily by
the inferior federal courts. The Supreme Court, having given the direction,
will probably be unable and unwilling to watch the road through the entire
journey. In the meantime many a federal judge may writhe in pain at the
prospect of having to follow "the last breath'' of the state judges.
HARRY SHULMANt
THE
CoMMON LAw
OF THE UNITED STATES
"There is no federal general common law." True, beyond doubt, in the
sense that there is no system of universal general rules and principles, no
"brooding omnipresence in the sky." In view of the action of the court in
51. Cf. Hum v. Oursler, 289 U. S. 238 (1933).
52. Shulman & Jaegennan, supra note 42.
53. 1 Wall. 175 (U. S. 1863).
54. 107 u. s. 20 (1882).
55. 276 u. s. 518 (1928).
56. In the type of case represented by Gelpcke v. Dubuque, there was considerable
vacillation between the theory of freedom from state decisions and the imp3innent of
contracts clause of the Constitution. The former prevailed. Sec Tidal Oil Co. v.
Flanagan, 263 U. S. 444 (1924). The Tompkins decision may leave that type o£ case
undisturbed; but if not, will not the due process clause be pressed into ser\'ice? Cf.
Great Northern Ry. v. Sunburst Oil Co., 287 U. S. 358 (1932) and Brinkerhoff-Faris
Trust Co. v. Hill, 281 U. S. 673 (1930).
tProfessor of Law, Yale Law School.
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overruling Swift v. T~lson, it may now be pertinent to ask whether there is
a "Pennsylvania general common law.'' Is there an omnipresence brooding
over the state of Pennsylvania?
The Supreme Court sent the instant case back to the District Court with
directions to find and apply the law of Pennsylvania, supposedly distinct
from the non-existent "federal general common law.'' To what sources is
that harassed trial court to go ? Do the words of Section 34 of the Judiciary
Act of 1789 now restrict the federal judge? Is it now "unconstitutional"
for him to go outside the opinions of the judges of the Supreme ·Court of
Pennsylvania?
If the answer to the foregoing questions is "yes," the federal judges are,
for the first time in one hundred and fifty years, limited in a way in which
the Pennsylvania judges are not themselves limited. The common law of
Pennsylvania, like its statutory and constitutional law, is an evolutionary and
variable product. In the main, it is the creative work of the judges, dealing
with the living stream of dispute and conflict, searching in each new litigated
case for a reasonable and workable guide to a solution. This guide is a rule
of law, a generalization drawn from life history, one that is so well drawn
from that history that it will successfully meet the pragmatic test of explanatory rationalization. The judge's work in constructing this generalization
instantly becomes a part of the history that will be used by the judges in
succeeding cases; it is one new step in the evolution of the law. Every new
case has some new factors that require original consideration by the court.
In some degree, every new case is a case "of first impression."
In dealing with each new controversy, the Pennsylvania judge must search
for the applicable law, not merely in earlier Pennsylvania cases, not merely
in the varying custom of Philadelphia or Pittsburgh or Bryn Mawr. He
looks for enlightening direction to the decisions and doctrines and custom
of England, old and new, of other states and countries, of other courts,
federal or state or foreign. He is not hidebound by any antecedent doctrine,
itself man-made by some judge or jurist like himself. Of course, he weighs
all such doctrines with constructive and respectful care, and passes his independent judgment as to which form of worded rule will best serve for the
solution of his immediate problem. He is far from certain of finding this
worded rule in the opinions of Pennsylvania courts alone.
Are the federal judges now being directed to act differently from the
Pennsylvania judges themselves? It can not be so intended; and if the
Supreme Cour.t does so intend, the federal judiciary, including the Supreme
Court itself, will be quite unable to comply with the direction. On the new
trial in the District Court, the applicable "Pennsylvania" law will be discovered by the same process and from the same broad general sources as
before. If, on appeal, the new decision is considered by the Supreme Court,
it will use the same process and the same sources.
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THE DEMISE OF SWIFT v. TYSON
1353
In the cases that are rightly before them, the federal courts have the same
constitutional power, as have the Pennsylvania courts, of detennining the
law that is applicable to the instant case. And their decisions have the same
effect a.S precedents and as a part of the new history. This will be true,
whether on the new trial the court decides that there is a special rule that
is applicable to trespassers on a longitudinal pathway by a railroad track,
or decides that there is not. In either event, tlte court is making the law of
the case and is helping to determine the rule that will be applied in later
cases.
Did the founding fathers, sitting in constitutional convention, have otlter
views than these? Did the members of Congress enacting tlte Judiciary Act
of 1789 have other views? Did they command tlte federal courts to follow
Pennsylvania "law" as yet unmade, at the same time that they gave these
courts jurisdiction over cases in which new law must often be discovered
and applied? "\Ve can not know what were their theories of the nature of
the common law and of its evolutionary growth. It is not necessary for us
to know them.
The overruling of Swift v. Tyson is a matter of much less importance
than it may seem to many. On the whole, its effect may be beneficial. It
will not affect "vested rights" or invalidate the numerous decisions rendered
on the theory stated by Mr. Justice Story. In actual practice, it will not
deprive the federal judge of the freedom and power tltat have been his.
It is not an order by Bmndeis, J., that hereafter Learned Hand, J., must
take his law from the words of Finch, J. If it is an admonition to federal
judges that there is no "federal general common law" that is to be found
solely in the opinions of other federal judges, much is thereby gained. But
if it is a direction to substitute an omnipresence brooding over Pennsylvania
alone, in place of the roc-like bird whose wings have been believed to overspread forty-eight states, something has indeed been lost.
A.L.C.
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